BADGER METER INVESTOR PRESENTATION...• Badger Meter introduced the first cellular radio for North American water utilities in 2014 using 2G/3G networks • In 2017, Version 2 was

© 2018 Badger Meter, Inc. 1

BADGER METER

INVESTOR PRESENTATION

February 2019

FORWARD LOOKING STATEMENTS

Certain statements contained in this presentation as well as other information provided from

time to time by the Company or its employees, may contain forward looking statements that

involve risks and uncertainties that could cause actual results to differ materially from those

in the forward looking statements. Please refer to our Form 10-K and other SEC filings for

a list of words or expressions that identify such statements.


BADGER METER IS A WATER FOCUSED, FLOW

MEASUREMENT LEADER

• Integrated technology company providing a comprehensive suite of flow measurement, connectivity and software / analytics solutions to a diverse customer base

• Industry leader in North American water metering, with a strong global position in flow metering technologies

• Attractive, long-term industry growth fundamentals:

− Stable business model supported by replacement demand

− Strong position in growing markets

• Culture of innovation and investment in R&D drives new product/service expansions

• Premium financial profile and exceptional operational track record


Utility Water Meters and

Systems76%

Flow Instrumentation

- Non-Water16%

Flow Instrumentation

- Water8%

84% WATER RELATED BUSINESS

LEADERSHIP TRANSITION

• Bockhorst named Chief Executive Officer effective January 1, 2019

• Meeusen to remain as Chairman of Board in 2019

• Wrocklage named Chief Financial Officer effective January 1, 2019

• Leadership message – no significant change in strategic framework


Accelerate customer-focused growth• Emphasis on profitable growth

over quantity

• R&D and capital investments

leveraged across served markets

Execution as a differentiator and

value driver

• Operational excellence as the

foundation

• Superior cash conversion

Disciplined investment where

there is a compelling competitive

advantage

• Software / Analytics / Internet of

Things

• Water quality assurance

Preserve the legacy of trusted

solutions, broad offerings and

innovation earned since Badger

Meter’s founding in 1905

FOURTH QUARTER SNAPSHOT

• Strong growth in sales and earnings

• Strong municipal water activity levels –up 8% year-over-year – continued favorable mix to higher technology products and services

• Flow instrumentation sales increased 9% with strong water/wastewater and oil & gas activity

• Further penetration of market leading ultrasonic and cellular technologies with strong service growth

• Good SAE leverage


Q4 2018 * Q4 2017 Change

Sales 104.4 96.7 8.0%

Gross Profit 40.2 39.0 3.1%

38.5% 40.3%

SEA 24.9 25.1 -0.8%

23.9% 26.0%

Operating Income 15.3 13.9 10.1%

Income Tax Rate 22.8% 34.5%

EBITDA 21.1 19.4 8.8%22.9% 44.1%

EPS 0.4 0.25 60.0%

Free Cash Flow 19.0 0.3

* Excludes executive retirement charges of $0.5M pretax, or

$0.01 per share, after tax.

2019 AND BEYOND


Pump maintenance

required!

Water consumed

Leak

Usage profiles

Billing integration

Contaminant

ingress alarm

DIY self-

service

Pipe burst risk…

reduce pressure?

Plug’n play third- party

integration

… and

more

Other

sensors

Mobility

Bill pay

Smart Cities are Increasingly Looking to Buy Solutions, not Just Meters

Smart Water = Solutions that provide actionable informationthrough data analytics from an interconnected and

interoperable network of sensors and devices that help people and organizations efficiently use and conserve water

• Positive backlog and outlook for 2019

• Launch of E-Series in additional sizes – both a technology enhancement and cost saving benefit

• LTE-M cellular – coverage, performance and lower cost

• AT&T Smart City Alliance

• While in early stages, Badger Meter sees two categories of long-term benefits associated with this alliance:

• Leverage Mayor / “C-Office” relationships – which can go both directions

• Keep abreast of cellular / IoT technology

• Disciplined and strategic tuck-in acquisitions

CAPITAL ALLOCATION PRIORITIES


Internal Investment to support organic growth and sustain core business

Grow the dividend annually in line with earnings

Accelerate acquisitions that align to strategy and return targets

35%

25%

15%

25%

Historically

35%

25%

>40%

Future Guidelines

Debt Reduction

Approximate percent spend

of gross operating cash flow

BACKGROUND INFORMATION


FLOW MEASUREMENT METHODS

• Badger Meter offers eight of the ten common flow technologies

• North American water meter market primarily uses positive displacement meters

• Global water meter markets are starting to shift from mechanical to electronic meters, such as magnetic and ultrasonic

• Rest of world water meter market primarily uses single/multi-jet and turbine meters

© 2018 Badger Meter, Inc. 9Source: IHS Research and Company Estimates

$0.0 $0.5 $1.0 $1.5

Single/MultiJet

Thermal/Mass

Variable Area

Vortex

Coriolis

Diff Pressure

Magnetic

Ultrasonic

Turbine

Positive Displacement

Water Flow

Bad

ger

Met

er O

fferin

g

($ in millions)

• Maintain our leading position in the North American water metering market through continued development of leading-edge technologies for

• Meters

• Radios

• Software

• Penetrate and grow select international markets (Middle East) with leading solutions

• Leverage AT&T alliance to gain access to Mayor/”C-office” decision makers

• Identify strategic acquisition opportunities to enhance technology and market channels – e.g. actionable information through analytics and sensors

WATER METERING KEY GROWTH

STRATEGIES


COMPETITIVE ADVANTAGES – WHY BADGER

METER WINS


Broadest Range of Offerings • Brass and polymer

• Mechanical and electronic (ultrasonic)

• Drive by, fixed and cellular radio technology

Technology Leadership • Well established E-Series Ultrasonic expertise – maintains accuracy

and lower cost circuit boards

• ORION Cellular – leverages existing infrastructure and coverage

• BEACON/Eye on Water – actionable data for utility and homeowner

Innovation • D-Flow technology for performance enhancement and cost

reduction

• LTE CAT-M (data) – “Smart City” ready

High Service Levels and

Customer Support

• Strong brand preference

• Channel coverage - regional service center and local distribution to

cover smaller utilities

• Highly trained Solution Architect, customer care and field technology

support

Low Lifecycle Costs • Highly accurate and quality products / low warranty

• Exceptional battery life

• Leverage existing cellular technology network

Small 45,000+

20%

Mid 4,00035%

Large 40045%

>50K Water Utilities in US

Utility Size/Share of Meters

METERS

•Broadest product offering - both mechanical and electronic meters in both metal and polymer housing

•Leading Edge Product: E-Series Ultrasonic Meter

•New Development: D-Flow Technology will be incorporated into the E-Series meters in late 2018; cost reduction and performance improvements

RADIOS

•Complete family of two-way connectivity solutions, including drive-by, fixed network and cellular radios

•Leading edge ORION Cellular Radio, allowing connectivity to future Smart City solutions

•New Development: ORION Cellular LTE introduced in 2017; LTE Cat-M in development

SOFTWARE

•BEACON AMA, (Advanced Metering Analytics) software suite provides analytics tools, dashboards and integration with utility billing systems to transform measurement data into a proactive decision making tool

•Leading Edge BEACON® AMA with EyeOnWater® Consumer Application

•Additional analytics in development

Leading-Edge Integrated Solutions

1

2

3

Mechanical Meters

Recordall® Disc

Recordall®Turbo Series

Recordall®Compound

Electronic Meters

E-Series® Ultrasonic

M-Series®

Electromagnetic

Cellular Endpoint Fixed Network Endpoint

Cellular NetworkORION® Network

Gateway Transceiver

Consumer Portal

SmartPhone

Utility Client

ComputersUtility Co.

BEACON®

Cloud-BasedSolution

1

2 2

2 2

1

3 3

3

TECHNOLOGY LEADER


SMART CITY ALLIANCE

• One of 11 companies

aligned with AT&T to

drive initiatives

• Initiative includes

improving utilization of

limited budget

resources

• Efficient city

operations

• Deployment of

resources

• Service and delivery

• Smart water metering

increases utility

revenue and drives

conservation and

sustainability


• Expand niche share by targeting four faster growing core markets:

• Chemical/Petrochemical

• Oil & Gas

• Building Automation/HVAC

• Water and Wastewater

• Continue to expand new product development to target niche market gaps

• Align with key market focused Reps to further penetrate sales channels (e.g. DNOW)

• Identify strategic acquisition opportunities to enhance technology and market channels

FLOW INSTRUMENTATION KEY GROWTH

STRATEGIES


STRATEGIC ACQUISITIONS

Steps in ProcessPotential

Acquisition Targets

150+

~80

In Process

Opportunities

RefinedAssessment

Assess Size andOwnership

In Process

• Companies previously tracked

• New targets added as a result of strategic review

• Searches among trade groups and various databases

• Eliminatecompanies due to size, ownership, and unattractive business

• Opportunities forfurther review

Expanded List of Potential Targets

• Flow measurement technologies• Sensors and analytics• Related control technologies• Geographic expansion

• Apply strategic considerations and assess specific attributes

Criteria


• Technology solutions that can be leveraged across both utility and flow instrumentation markets

• Smart City / Internet of Things – water usage reduction, cleanliness, leaks, shut-offs, etc.

• SaaS

• International penetration

• Flow instrumentation core market penetration (caveat that total mix no more than 30% of consolidated revenue)

• Disciplined capital allocation


APPENDIX

GLOBAL MANUFACTURING AND INNOVATION


LOS GATOS

MEXICO CITY

SINGAPORE

SLOVAKIA

7 Manufacturing Facilities

STUTTGART

NOGALES

BRNO

8 Sales/Distribution Centers

2 Innovation / R&D Centers

SHANGHAI

TULSA BERN

RACINE

DUBAI

DENVER

MILWAUKEE

NASHVILLE

LULEA SWEDEN

POLAND

RADIO CONNECTIVITY - PENETRATION

CONVERSION TO CONTINUE

• Badger Meter was the first US company to offer radios on water meters (1988)

• Radio connectivity allows for automated metering and integration of real-time data with analytics software

• Radio connectivity reduces utility costs, improves billing accuracy, aids in leak detection and encourages conservation

• Approximately 60% of the U.S. market has been converted (per IHS) – every 1% additional conversion represents significant increased sales opportunity for Badger Meter


0

20

40

60

80

100

120

140

2017 2018 2019 2020 2021 2022

me

ter

un

its i

n t

ho

usa

nd

s

North American water meter marketprojected conversion to radio connectivity

Manual Read Meters Meters with Connectivity

59% 62% 65% 68% 71% 74%

MANUAL READ

$40-$50 price

per meter

METERS WITH RADIOS

$150-$250 price per

system

Source: IHS Research, 2017

• Badger Meter introduced the first cellular radio for North American water utilities in 2014 using 2G/3G networks

• In 2017, Version 2 was introduced using the LTE CAT-1 networks for machine-to-machine data communication – first step to “Internet of Things” (IoT) and “Smart City” applications

• Cellular network technology will soon be splitting between LTE 5G for consumers (phone calls, texts and video streaming) vs LTE CAT-M technology for IoT/Smart City

• ORION Version 3 is under development using the new LTE CAT-M network technology

• Each cellular phase represents cost reduction/performance improvement and each version is backward and forward compatible

ORION V1 (LTE) ORION V2 (CAT 1) ORION V3 (CAT M)

LTE 2G/3G/4G

LTE CAT-1LTE CAT-M

LTE 5G

DA

TA C

OM

PLEX

ITY

CONSUMERUSE

MACHINE-TO-MACHINEUSE

2014 2015 2016 2017 2018 2019

CELLULAR TECHNOLOGY ROADMAP


• Compared to fixed networks, no infrastructure for the water utility to maintain (cost advantage)

• 100% coverage: no “hard-to-read” locations compared to fixed networks

• Technology upgrades do not require water utility to replace equipment on towers

• After natural disasters, cellular systems are the first to come back on line

Advantages of Cellular Technology

ACQUISITION HISTORY

Over the past 8 years, Badger Meter has made 9 strategic acquisitions, for a total of $147M

Year Company Type Location Price

Water Utility Instrumentation and Connectivity:

2018 Innovative Metering Solutions

Distributor Tampa, FL $8M

2017 Carolina Meter Distributor Wilmington, NC $6M

2017 D-Flow Technology/R&D Lulea, Sweden $23M

2015 United Utilities Distributor Smyrna, TN $3M

2014 National Meter Distributor Denver, CO $23M

2013 Aquacue Technology/R&D Los Gatos, CA $14M

Flow and Industrial Instrumentation:

2012 Racine Federated Technology/Manufacturing Racine, WI $57M

2011 Remag Technology/Manufacturing Bern, Switzerland $5M

2010 Cox Instruments Technology/Manufacturing Scottsdale, AZ $8M

The distribution acquisition strategy is now completed


Documents

BADGER METER INVESTOR PRESENTATION...• Badger Meter introduced the first cellular radio for North American water utilities in 2014 using 2G/3G networks • In 2017, Version 2 was